INDUSTRIAL PROJECTS – APPROVAL GUIDELINES

The Malaysian Government’s guidelines are based on the Capital Investment Per Employees (C/E) Ratio. Projects with a C/E Ratio of less than RM55,000 are categorised as labour-intensive and will not qualify for a manufacturing licence or tax incentives, unless it fulfils one of the following criteria:
  • The value-added is 30% or more
  • The managerial, Technical and Supervisory (MTS) Index is 15% or more
  • The projects undertakes promoted activities or manufacture products as listed in the List of Promoted Activities and Products for High Technology Companies
  • Existing companies (formerly exempted) applying for a manufacturing licence

    A licensed company which desires to expand its production capacity or diversification of product range by manufacturing additional products needs to apply to MIDA.
CONDUCTING BUSINESS IN MALAYSIA
  • By an individual operating as a sole proprietor
  • By two or more (but not more than 20) persons in partnership
  • By a locally incorporated company/by a foreign company registered under the provisions of the Companies Act (CA) 1965
  • Must be registered with the Companies Commission of Malaysia (SSM) under the Registration of Business Act 1956.
COMPANY STRUCTURE – (3 TYPES)
  • A company limited by shares, the most common company structure in Malaysia
  • A company limited by guarantee
  • An unlimited company, a company formed on the principle of having no limit placed on the liability of its members.
PROCEDURE FOR INCORPORATION
An applicant must be made to the SSM using Form 13A together with a payment of RM30 (for each name applied) in order to determine if the proposed name of the intended company is available.

Incorporation documents are to be submitted to the SSM within three months from the date of approval of the company’s name:
  • Memorandum and Articulars of Association
  • Declaration of Compliance (Form 6)
  • Statutory Declaration by a person before appointment as director (Form 48A)
  • The original Form 13A
  • A copy of letter from SSM approving the name of the company
  • A copy of the identity card of each director and company secretary or a copy of passport where a foreign director is appointed.
Incorporation of local companies can be completed within one(1) day through the introduction of the single interaction counter introduced since 1 April 2010.
 
 
COMPANY SET-UP - BUSINESS LICENSING REQUIREMENTS FOR BUSINESS/INDUSTRY
ACTIVITY TYPE OF LICENCE/APPROVAL APPROVING AUTHORITY
Registration of Company
Registration of Business
Certificate of Incorporation of Company
Certificate of Registration of Business
Registry of Companies
Registration of Business Office
Preliminary Lecencing Manufacturing Licence Ministry of International Trade and Industry (through MIDA)
Premises for Operating Trade/Business/Industries Premises Licence for trade/industry/business concerned

Approval for Sign Boards/Advertisement Sign
Respective Local Authorities


Department of Occupational Safety and Health
Factory Inspection Factory Inspection Report  
Utilities – Electricity Approval for electricity supply/sub-station/Install standby Generator/Licence to generate, Transmit/Distribute Energy from any installation Tenaga Nasional Berhad/Department of Electricity Supply
Utilities – Water Supply Approval of water supply Waterworks Department
Utilities – Telecommunication Approval for telephone lines Telekom Malaysia Berhad
Manpower – Employment Permit allowing employers to keep Employees’ Register in Company’s Headquarters Registration of workers with the Employees Provident Fund (EPF)
Registration of employees with the Social Secutity Organisation

Labour Department

Employees Provident Fund
Social Secutity Organisation
Working hours Limit Permit to exceed the limit of working overtime hours/vary hours of work/allow women working at nigh Labour Department
Expatriate Posts Approval of expatriate posts with valid National Passport/recognised travel documents MIDA
Visa requirement, Employment Pass Malaysia Mission abroad Immigration Department
Foreign Workers Approval to employ foreign workers
Visa Requirement
Valid National Passport, Employment Pass
Ministry of Human Resources
Immigration Department
Transportation by Land Licence for commercial vehicles
Driving Licence for goods vehicles
Approval for locked van
Commercial Vehicles Licencing Board
Road Transport Department
Road Customs & Excise Dept.
Transportation by Air Declaration for transportation of dangerous goods Civil Aviation Dept.
Import of Prohibited Goods Import licence for goods specified in Customs (Prohibition of Imports) Order 1988 Depts/Statutory Bodies appointed Ministry of International Trade and Industry and other Ministries, by the Director General of Customs
Import licence for liquor and cigarettes Royal Customs and Excise Dept.  
Export of Prohibited Goods Export licence for goods specified in Customs (Prohibition of Exports) Order 1988 Depts/Statutory Bodies appointed

Export Approval under GSP System, Certificate of Origin
Ministry of International Trade and Industry and other Ministries, by the Director General of Customs

Ministry of International Trade and Industry
Local Market Sales Tax Licence Royal Customs and Excise Dept.
Banking and Finance    
Local Payment in Foreign Currency, Borrowings, Approval letter from the Controller of Foreign Exchange Balance of Payments Department Central Bank of Malaysia
Opening of Bank Account, Flow of Funds – Export proceeds, Investment abroad and loan to non-residents